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Mining scam tainted Janardhana Reddy to fight election

By Vicky Nanjappa
December 07, 2012 11:20 IST

Jailed former Karnataka minister G Janardhana Reddy's is likely to contest the elections in Karnataka on a BSR Congress ticket, reports Vicky Nanjappa

The Bellary mining scam, estimated to be around Rs 7,000 crore, is one of the biggest scams that the country has ever seen. The Central Bureau of Investigation had earlier estimated the scam to be around Rs 5,000 crore, but it appears that the figure is increasing as the investigation progresses.

The Enforcement Directorate recently attached shares belonging to former Karnataka minister G Janardhana Reddy, who has been implicated in the mining scam. The share value has been totaled at Rs 884 crore and the same has been attached under the Prevention of Money Laundering Act. During investigations, the ED found that there were 884130000 shares in all and each had the value of Rs 10 amounting to Rs 884.13 crore. All these shares belonged to Brahmani Industries Limited and were held by the Obulapuram Mining Company that belongs to Janardhan Reddy and his associates.

The CBI has said that so far around 65 lakh tonnes of ore has been exported. Each ton was exported at USD 150, which amounts to Rs 5,000 crore. In addition to this, gold, property and other articles too have been seized, totaling to approximately another Rs 2000 crore.

Janardhana Reddy, who is behind bars, has been denied bail several times ever since the CBI took him into custody. CBI sources claim that the case against Reddy is watertight.

As per the records of the Obulapuram Mining Company, around 29 lakh metric tones of iron ore was mined from the AGK mine. The OMC used the lease on the 68.5 hectare site that was granted to the AGK mine in Andhra Pradesh.

In 2010, the quality of the iron ore in these permits had been shown at 65 per cent ferrous content. The CBI took the help of the National Mineral Development Corporation and also the Indian Bureau to collect the ore. Analysis found that the ore was of low and not commercial grade. Further it was also found that the there was no excavation of 29 lakh tonnes of ore as it was claimed by the accused. Based on satellite imagery it was visible that there was no major activity between 2007 and 2010. This was an indicator that no mining activity had been carried out as per the mining plan and only 40,000 tonnes of ore was excavated within the permissible lease boundary and the rest had been excavated from outside the lease area.

The CBI also collected evidence given to them by neighbouring mine owners and truck drivers. In short, Reddy had used the mining lease granted to him by the Andhra Pradesh government to carry out illegal mining activities in Karnataka.

The battle ahead for Janardhana Reddy is a tough one. He has a host of charges against him. The charges include;

Criminal conspiracy: Section 120-B of the Indian Penal Code. He conspired with officials to get the lease.

He cheated the government by exporting illegal iron ore. He acquired a permit from Andhra Pradesh but used it to lease in Karnataka and hence has been booked under Section 420 of the IPC.

Booked under Section 468 and 471 for using forged documents to carry out mining.

Committed criminal breach of trust under Section 409

Booked under Section 13(2) of the Prevention to Corruption Act.

However, these charges have not deterred Reddy from staying active in politics.

Although he and his brothers are officially still part of the Bharatiya Janata Party, by election time in Karnataka they would all be part of the Badavara Shramikara Matthu Raithara Congress party which was launched by their blue-eyed boy Sriramulu, a former minister.

Janardhana Reddy, who has been a member of the legislative council, will this time around contest the elections even if he is behind bars. He would contest from Bellary on a BSR Congress ticket and his supporters swear that they would move heaven and earth to ensure his victory. The Reddy brothers and Sriramulu would be locked in a direct battle against the BJP and they would try and ensure that their former party is defeated.

The Reddys have controlled Bellary for nearly a decade and the forthcoming elections would be a testing ground for them. Sriramulu, who had faced a by-election after he quit the BJP, had won by a huge margin. His main opponent from the BJP even lost his deposit.

For now, the Reddys are mum about their future plans. Although the BSR Congress expects at least 10 seats, political observers say a more realistic number would be five. With regard to an alliance, the BSR Congress is more likely to go with the Congress in a post-poll alliance.
Vicky Nanjappa in Bengaluru